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Jesse McClellan, Esq.

About Jesse McClellan, Esq.

Jesse is a licensed attorney and former sales and use tax auditor. He is a principal at McClellan Davis, LLC, a firm that specializes in representing businesses for sales and use tax matters. Email Jesse

Construction Contractors as Consumers When Installing Property of Others

In previous posts, my partner, Dan Davis, CPA, addressed how states tax installation charges and how states tax contracts with exempt entities. This article includes a related question: how states tax property that is being installed when title to that property is not held by the installing contractor and tax was not previously paid. For example, California generally considers a contractor to be the consumer of equipment and machinery which is furnished and installed under a contract with the U.S. Government, but the contractor will not generally be considered the consumer of such property if title is […]

Qualifying factors for California’s Manufacturing Exemption

California recently joined the majority of states when it enacted a partial sales and use tax exemption for property purchased for use in manufacturing and research and development. The exemption is established under Revenue and Code section 6377.1, as further explained under Sales and Use Tax Regulation 1525.4 with an effective date of July 1, 2014. The exemption is subject to a two hundred million annual cap, and it effectively reduces the tax rate by approximately four percent (4%) to the otherwise applicable rate. It actually applies to a rather broad scope of industries and even extends to real property […]